T&D World Magazine

PG&E Reacts Favorably to SmartMeter Proposed Decision From Utility Regulators

Pacific Gas and Electric Company reacted favorably to a proposed decision before the California Public Utilities Commission that, if approved, will enable the utility to install 9.3 million SmartMeters for its 5.1 million electric and 4.2 million gas customers.

"PG&E's SmartMeter proposal is part of a companywide transformation effort that will deliver substantially improved customer service more efficiently and cost-effectively," said PG&E Corporation Chairman, CEO and President Peter Darbee. "We are delighted the SmartMeter proposal is one step closer to providing real economic, environmental and energy efficiency benefits to customers."

SmartMeter technology would provide a wide-range of benefits to customers, the utility and the state. SmartMeters would improve customer service and provide operational savings through increased efficiencies. They would allow for better detection of power outages and can lead to faster outage restoration. Customers would no longer need to unlock gates, tie up dogs or make special arrangements to allow meter readers access to tough-to-reach meters. Customers could also go online to review their own energy use.

Because SmartMeters allow for remote reading of electric meters as often as every hour, this would also allow customers to voluntarily take advantage of electric prices that vary by time of day -- potentially realizing cost savings by shifting their energy use from peak to off-peak periods. Doing so could reduce the cost of energy procurement and perhaps even help lessen California's growing need for more electric power and energy infrastructure.

The electric SmartMeters are virtually identical in size and appearance to existing ones, and the gas SmartMeter modules are only a small part added to an existing meter. Dozens of utilities in the United States and abroad already employ advanced meters.

The deployment cost of the new SmartMeters to virtually every PG&E customer is estimated to be $1.74 billion, consisting of a capital cost of $1.41 billion and an estimated expense of $330 million. To fund SmartMeters, PG&E is seeking slight rate increases. For the average residential customer with both gas and electric service, the increase ranges from 49 to 99 cents per month for the first five years, or about 1 percent. In time, SmartMeters are expected to greatly reduce costs associated with meter reading and to produce savings in energy purchases by PG&E, with the realized savings benefiting customers.

The SmartMeter project stems from a 2002 California Public Utilities Commission order for utilities to consider programs and tools that offer customers improved options to reduce their electric usage during high-demand situations. California's investor-owned utilities were directed to explore advanced metering technologies and conduct a two-year statewide pilot program to gauge customer interest in dynamic pricing options.

The commission could modify the proposed decision. A decision from the commission could come as soon as late July.

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